The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is tightening control over crude oil exports to ensure that crude designated for local refineries stays within Nigeria’s borders. Moving forward, export permits will no longer be granted for crude cargoes initially earmarked for domestic refining—unless explicit approval is obtained from the NUPRC.
NUPRC’s Stance on Crude Oil Diversion
Gbenga Komolafe, Chief Executive of NUPRC, made it clear that diverting crude meant for Nigerian refineries is a violation of existing laws. In a letter dated February 2, 2025, Komolafe highlighted ongoing disputes between refiners and producers, with each side pointing fingers over supply inconsistencies.
- Refiners’ Perspective: Refiners accuse crude oil producers of prioritizing foreign sales, leaving them unable to meet local refining demand.
- Producers’ Response: Producers argue that Nigerian refiners fail to meet agreed commercial terms, making it difficult to sustain consistent supply to local facilities.
This new policy is aimed at protecting Nigeria’s refining sector, reducing dependency on imported refined products, and strengthening the local economy.
Strengthening Compliance Measures
To address these challenges, NUPRC is reinforcing compliance with the 2023 Production Curtailment and Domestic Crude Oil Supply Obligation Regulation. This regulatory framework is designed to ensure that Nigeria’s domestic energy needs are prioritized.
Citing Section 109 of the Petroleum Industry Act (PIA) 2021, Komolafe stressed the importance of adhering to the law. He warned that the NUPRC will not tolerate violations of regulations governing domestic crude oil supplies. Producers who fail to comply risk losing their export permits.
What This Means for the Nigerian Oil Industry
This development underscores the critical role of domestic crude supply in maintaining Nigeria’s energy security. By ensuring that local refineries receive the crude oil they need, the NUPRC aims to stabilize the supply chain, support local industries, and reduce Nigeria’s dependence on imported petroleum products.
For oil producers, the message is clear: follow the rules or face serious consequences. This is not just about regulatory compliance; it’s about securing Nigeria’s energy future.
Conclusion
The NUPRC’s tightened regulatory measures are a wake-up call for the industry. All stakeholders must work together to ensure that Nigeria’s domestic energy demands are met without compromising export opportunities. Compliance with the new regulations will help strengthen the local refining sector and bolster the country’s energy security.
Good one..